Hong Kong needs to decide what it wants to be

Andrew Work (12th January 2007)

Who are we?  More importantly, who will we be tomorrow?  Hong Kong has engaged these questions as we mark the end of our 10th year as a Special Administrative Region.  We are special today, but how we will be special tomorrow?  Will we be special at all?

Welcome to the Age of Existetialism in Asia’s World City.  Hailing from a country obsessed with such questions for decades, it seems a fruitless debate.  An adoptee of a city I love, the result of the debate is vital.  Many issues the public and our representatives have grappled with this year, more than any since our rebirth in 1997, drive to the core of great questions about who we will be.

With the WTO Ministerial meetings just passed, the people of Hong Kong were reminded of our special role in global exchange as our unilaterally open borders, rule of law and institutional strength serve to make us a true leader in trade.  Hong Kong ranks second to none in one of the great freedoms – freedom in movement of goods.

Hong Kong has long exemplified the second great freedom: freedom of capital.  As China grows, our money markets and sensible policies on not taxing or otherwise restricting money that flows in and out of Hong Kong makes eminent sense within our strong institutional framework.

On bedrock issues, we are deeply divided, in part because we have not determined what we believe.  Is antitrust law a means of leveling the playing field, or creating a quango to reward friends and punish enemies?  Will minimum wage help workers or diminish intitiative, level salaries down and destroy opportunity for our youngest and least skilled workers?  Can Marx’s  omnipotent government control labour markets and industry to generate perfect outcomes for everyone?  Or do we trust Lao Tse’s and Hayek’s spontaneous order to generate the best possible outcomes with the most justice in a world where each individual has sometimes coincidal and sometimes conflicting desires.

On one issue in 2006, the people of Hong Kong clearly sided with the individual and against statism.  The GST was condemmed for many reasons, most related to self-interest.  This is no bad thing.  The people clearly sent a message that they did not believe that the tax was good for their personal situation, whether they thought it would hurt sales, add administrative costs or increase government monitoriing of their activities to an unacceptable level.  Others rejected it out of their concern for the extension of government powers to control societal outcomes.

Important issues lie ahead.  It seems strange  we accept that our most basic needs, like food and clothing, can be trusted to the market.  Yet people have the strange idea that the government has to play an overwhelming role in other areas.  We supposedly need a stable source of  taxation to allow the government to solve future challanges, especially education and healthcare.

With more market forces in those areas, we could enact the reform we need without depriving citizens of their hard earned wealth.  The government took a small step in this direction with their introduction of their kindergarten voucher programme.  However, the Secretary of Education and Manpower differs with many, including his own government, on allowing for-profit firms to receive government monies.  This conflict will arise again as the government considers its role in future provision of healthcare.  We do know is that the current situation is unsustainable.  We must determine who we wish to be before committing to a commonly supported solution.

Within this debate exists one vision for Hong Kong, an answer to these existential questions.  It is for a place that is not only relatively free, but uniquely free, in the degree and nature of freedom.  We are open to goods and people – coming and[ital] going.  We must likewise open our doors to those who would come here and provide services to us.  This must be achieved while preserving and extending our strength in rule of law and honesty in institutions.  State structures promoting privelege for some must be dismantled and the red tape constraining the enterprising must be removed.  As participants in this experiment, we must accept our responsibilities to observe the law and our duty of charity.  Welfare robs the productive and demeans the reciepients -charity embodies our duty to freely choose our contribution to our fellow man.

For 2007, the debate will be vigourous, and must be engaged.  Our freedoms and future are at stake.

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